Dr. Vandana Gaur

Online real money gaming platforms are digital platforms where individuals can play games, participate in gambling, or engage in other activities with the potential to win or lose real money. Playing online games or betting on different platforms has become a new source of entertainment nowadays.How elated a player feels when he is able to earn money while playing but not many are aware about the rules of taxation when it comes to paying a part of your profit as tax According to Income Tax Act Under section 115BB any Income earned through game winnings is subject to tax at the rate of 30%.This means if you are earning Rs 100 as profit then only Rs70 is your income rest 30 will go to the Income Tax Department The gaming business has been increasing manifold in the last ten years and is expected to grow by 5billion dollar by 2025.

Real money gaming platforms in India are typically subject to GST on the revenue they generate from their services. The GST rate can vary based on the specific type of game and the state in which the service is being provided.One part is paying the taxes by the player but the companies who are offering these games are also paying GST on the transactions.Operating an online real money gaming platform involves various considerations and challenges, including legal and regulatory compliance, business operations, and customer engagement

The Directorate General of GST Intelligence ( DGGI) is the apex intelligence and investigative agency for matters relating to violation of the Goods & Services Tax, Central Excise Duty and Service Tax.Currently there is a tiff going on between the online real money gaming platforms and DGGI on the method of tax calculation.

Currently these platforms are paying 18% commission players deposits but according to the new method of tax calculation every time a player deposits money , GST of 28% is applicable on the deposit which is increasing the tax liability on these companies by 1300% to 1400 % annually(Rajput and Saha,ET).As this method of calculation is being followed on the bets placed from the year 2017 so it’s a tight situation for the online real gaming platforms as the liability heading for them is much higher than their revenue and it’s a great loss for these companies.Since the bets place are considered from the year 2017 so its difficult to trace the customers too and the entire liability is of the companies. Apart from this Real money gaming platforms may have to incur additional costs related to regulatory compliance, including obtaining licenses, audits, and other administrative expenses.

The tax regime for real money gaming platforms in India is complex and can be subject to change due to legal developments and government policies. Therefore, it is crucial for operators of such platforms to work closely with tax professionals and legal experts who are knowledgeable about the latest regulations and can provide guidance on tax compliance. Staying up-to-date with changes in tax laws and regulations is essential for ensuring compliance and avoiding legal issues.